Last quarter was the first time ever that US pay-for TV subscription rates declined, and in Q3 2010, cable lost over 518,300 subscribers in total, according to GigaOm. Four of the five biggest cable companies lost customers: Comcast had more than half of the losses at 275,000, Time Warner took a 155,000 subscriber hit, Charter Communications lost 63,800, and Cablevision waved goodbye to 24,500 customers. The third largest cable provider, Cox Communications, is privately held and therefore doesn't have to announce its subscriber numbers publicly. The number is thus likely even bigger if we could include Cox plus all the smaller cable companies.
Now, we normally wouldn't cover cable TV news, but more than half a million users ditching their cable companies is significant. The reason for such staggering losses is simple: the Internet is taking over. Cable is falling on the wayside as services like Netflix and Hulu continue to expand their offerings.
Cable companies are blaming the poor numbers on the weak economy but instead of embracing the Web, they're merely raising prices for remaining customers. Talk about digging yourself into a hole. In fact, Comcast admitted that its average customer revenue rose by 10 percent year over year to $136 per month. Charter's similarly jumped by nine percent to $126 monthly fee. Cablevision's price didn't increase, but monthly revenue per customer still amounted to a huge $149 per month.